Posts Tagged ‘UBS’

Tuesday: The Brown Booster Shot

What a morning already!

The futures were drifting along until 3 am and the Shanghai Composite had closed down 2.3% at 2,897.  At 3:23 the Hang Seng was looking to close down as well but then Gordon Brown, the UK Prime Minister, on his way to the G20 meeting in Pittsburgh this week said:

The stimulus that we have still got to give the world economy is greater than the stimulus we have already had.  What we want to do is safeguard a recovery from a recession we feared would develop into a depression… By meeting at Pittsburgh, we are looking at how we can put in place for the future the mechanism or path that can lead us to either making decisions about better ways of creating growth that is sustainable in the future, a better early warning system for the world economy about potential crises, a better way of resolving difficulties or imbalances around the world..  I have been talking to many countries in Asia as well as in Europe, and I have been talking to President Obama and others, and I believe that there is support for that framework

WooEee!  More free money!!!  No sooner did the words come out of Mr. Brown's mouth than the Hang Seng began to climb, reversing a down day to finish up 228 points, right at the 21,700 line they have been struggling to hold since last Thursday.  Gold flew up to $1,020 and oil jumped to $71 worthless-looking dollars and, as usual, once Asia closed, the dollar was free once again to drift down to 91 Yen (Japanese markets were closed today).  But, despite his performance, Gordon Brown may not win today's Globey Award for blatant market manipulation. 

Brown's performance was great – make a bold statement that indicates another $13Tn or more may be dumped on the Global economy and insinuate the the whole G20 is behind him before jumping on a plane, leaving the British tabloids (owned by Gang of 12 member Rupert Murdoch) to boost the market for 2 days in a row – BRILLIANT! 

But, he does have serious competition this morning by not one, not two but THREE Gang of 12 members as UBS, GS and JPM triple teamed up and all issued reports saying "Russian stocks are poised to surge, extending an 88 percent rally this year, as
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Who’s on the List?

Who’s on the List?

Courtesy of John Rubino at Dollar Collapse

Yesterday’s Wall Street Journal ran an article on Washington’s ongoing attempt to discover where its citizens keep their money. Here’s a quote that illustrates the complexity of the cat-and-mouse game:

“At one point, the Swiss lawyer recommended to Mr. McCarthy that he set up a Liechtenstein foundation that would serve as an umbrella over a Panamanian or Hong Kong corporation. That ‘would allow for an extra layer of privacy and help to conceal’ Mr. McCarthy’s identity, said the statement of facts.”

And three observations:

1) The deal between the IRS and UBS apparently requires the latter to hand over thousands of names of U.S. citizens. It’s a safe bet that hundreds of those are major donors to the campaigns of the politicians currently running the country — and a few dozen are the politicians themselves — which creates some amusing moral dilemmas for the enforcement folks and the media.

2) In the wake of the UBS fiasco, it’s going to be even harder for U.S. citizens to get foreign bank accounts, which is exactly what Washington wants.

3) China might be a little harder to push around than Switzerland. 

 

UBS Tax Crackdown Widens to Hong Kong

By CARRICK MOLLENKAMP
 
The U.S. crackdown on clients of UBS AG is widening into a global hunt, with the government detailing in court documents how the Swiss bank and outside advisers helped Americans hide money using enterprises set up in Hong Kong.
 
For the first time in the government’s long-running bid to ferret out the names of U.S. tax-evaders from the Swiss bank’s client list, plea agreements entered in the case are providing a clearer picture of UBS’s sophisticated efforts to help Americans hide income or the existence of foreign bank accounts.
 
On Friday, John McCarthy, a UBS client in California, agreed to plead guilty to one count of failing to file an annual report to the Treasury Department. A document filed with the plea shows the tax scheme relied in part on channeling funds to a Swiss UBS account held in the name of a Hong Kong entity, the second time accounts in the Asian financial hub have figured in


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Testy Tuesday Morning – $1.70 for a Pound? I Don’t Think So…

Has the dollar fallen too far?

The British Pound is now fetching $1.70, a huge break-out and well above the June highs, now valued higher to the dollar than any time since last October.  Britain has aggressively cut rates and expanded their money supply and Britain had banks falling like dominoes before being taken over by the government.   The UK's budget deficit as a percent of GDP is forecast to be 11.6% this year, the second worst on the planet, exceeded only by the US's projection of 13.5% but the UK is forecast to catch up in 2010 with 13.3% of their GDP taken up by debt.  Why then, you may wonder, is the British Pound up 25% against the dollar this year and almost 10% this past month?

The answer to that is the same as the answer to many irrational market moves – SPECULATION.  The dollar in general has been pushed back down to 1-year lows by currency speculators and the Pound is benefiting from their No-Euro policy that makes the UK a relatively safe-looking investment for currency traders who are worried that Eastern Europe will eventually prove to be a weight that drags the rest of the EU down.  With a population and economy about the size of California and the independence of a sovereign nation, any small sign of improvement (like the recent uptick in manufacturing data in the UK) can quickly pull money back to the Pound who, just 30 years ago, were the second strongest currency in the world and, for 500 years before that, was the undisputed global leader.  The UK, as it was 500 years ago, is still ruled by its powerful banking sector and again the fishbowl-like nature of the island nation tends to magnify small improvements we've seen in the UK banks, which causes Japanese housewives (who are very into FOREX trading) to push more money into British currency. 

Japan Housewife forexToday it may become apparent that the Japanese housewives have become a little irrational in their Pound exuberance as nationalized British Bank, Northern Rock, showed a 31% increase in first-half losses to $1.25Bn as bad loan provisions jumped to over $1Bn from under $300M last year.  Even worse for the bank – deposits fell 17% despite the bank's 100% government guarantee
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Merrill: “Retail REITs – Tough But Stabilizing”

Courtesy of Tyler Durden

Merrill: "Retail REITs – Tough But Stabilizing"

In his first note released in the post Sakwa world, Craig Schmidt continues to attempt to restore confidence in retail REITs. It would, after all, seem prudent to bang clients’ heads into their desks until they see the light at the end of the tunnel (oncoming bullet train?) at a time when the only cash, and equity value, REITs can create is by raising expensive, dilutive equity in order to repay the cheapest form of capital (that of secured loans previously held by Mr. Schmidt uber parent, Bank of America). This is especially true, after these same clients have plunked down about $20 billion in new equity in companies that at this point exist on fumes of hope, speculation and short covering. not surprisingly, the report comes just prior to Realtors’s release which indicates that Commercial Real Estate activity in Q1 fell 4.8% from Q4 of 2008 and 12.9% year over year, while vacancy rates are poised to rise to 12.1% from 9.7% last year.

While the title is expected, even Mr. Schmidt is at a loss to present the REIT "green shoots" that would substantiate his note. Amsuingly, Schmidt quotes favorable restaurant trends to back up the stabilization thesis:

Some positive signs included Dr. Mark Zandi’s (Chief Economist, Moody’s economy.com) citing that restaurants reported stronger same store sales gains than supermarkets in the most recent period, which suggests an increase in consumer confidence. Additionally, retail trends, while still negative, have improved from 4Q08, which were so dramatically negative that retailers were behaving like “deer caught in the headlights.”

Now that people are rushing to Nobu, maxing out their Centurions and hoping, very much like YRC, they can apply for and receive TARP funding, all must be good. The other "solid" positive:

Of the most seriously troubled retail markets (Southern California, Florida, Phoenix and Las Vegas), the only market that seems to have improved somewhat is Southern California. We still hear very distressing things about the other markets.

Nothing like Californians spending with reckless abandon, concurrently with voting down Schwarzenneger’s hail mary proposals to scrape up some semblance of a budget. Next stop: California’s utter fiscal collapse, and Geithner fixing that problem as well, by securitizing all default credit cards through a AAA rated TALF issue. Now, as for


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Sequenom takes a swan dive

Today’s tickers: SQNM, YHOO, XLY, XLI, GMCR, NWL, PFE & UBS

SQNM Sequenom, Inc. – Shares of the diagnostic testing and genetics analysis company have plummeted by more than 75%, crashing through the 52-week low for the stock of $6.19, to arrive at the current price of $3.68. The catastrophic decline stems from SQNM’s announcement that the launch of its SEQureDx test for Down syndrome is now delayed due to findings that employees of the company had mishandled crucial test data supporting the product’s validity. The news of the test’s delay does nothing to help the fact that the firm’s first-quarter loss widened to 29 cents per share, and Sequenom received a number of downgrades today including a rating of ‘underperform’ from ‘market perform’ by an analyst at Oppenheimer & Co. Option investors reacted to the bearish move on the stock by picking up 1,500 protective puts at June 2.5 strike price for an average premium of 41 cents apiece. In the near-term May contract, traders shed more than 4,200 calls at the May 5.0 strike for 39 cents each. Investors who were long put options at higher strikes were able to make a killing today by selling the protection. For example, it appears that one trader originally purchased about 3,500 puts for 2.00 apiece on April 1, 2009, and today sold the lots for 6.80 each. The profits garnered on such a trade amount to 4.80 per put option sold. On the flip side, investors who appear to have held a short put position at higher strikes were faced with deep in-the-money premiums. One investor who looks to have sold 3,500 puts at the May 12.5 strike for about 1.20 apiece back on April 1, 2009, today was forced to close out the short position by paying a premium of 9.00 each for the put options. This transaction results in a loss of 7.80. Option implied volatility on the stock sky-rocketed as high as 239% up from yesterday’s reading of 91%, but has since tapered off to the current value of 195.5%.

YHOO Yahoo! Inc. – The global internet brand has experienced a modest 1.5% rise in shares today to stand at $14.27. Options activity was slightly more bullish today with more than 3 call options traded to every put in play on the stock. Optimistic investors targeted the June contract where more than 11,100 calls were purchased…
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Friday Morning – Google, GE and Citi Oh My!

Never before have such important earnings moved the market so little!

Last night we heard from GOOG who once again pulled a rabbit out of the hat with an 10% increase in revenues as there was a huge surge in searches relating to unemployment, bankruptcy, foreclosures,  loans, alcohol and gambling proving that there is always someone who can fiddle while Rome burns.  We are thrilled, of course, as we played GOOG to flatline and it looks like we'll get our wish as my trade idea on Google in yesterday's Member Chat was: "May $400 calls for $17.25, selling Apr $400s for $9 and May $370 puts for $15.55, selling Apr $370 puts for $7.15."  We'll see how it actually performs but anything between $370 and $400 should be a very nice win on this trade!

As David Fry's chart indicates, GOOG was already driven hard to fill it's October gap and faced significant resistance at $390.  Also facing significant resistance at Google is their market share, which was 79.9% in October of 2008 and is 81.39% as of March.  Another negative that came out of the CC was that the company is getting lower click conversion rates, possibly indicating that this form of advertising is being ignored more often by the users.  In fact, AdSense revenue was down (3%) for the first time ever.  As GOOG is still very much a one-trick pony, the analysts on the line pressed management hard about how they could monetize other products and what new revenue streams they would be developing.  To Google's credit, people have been worried about this for 2 years yet, despite the recession, the company did post their best quarterly profit ever and they did it the way well-managed companies do – by watching the bottom line.

GE handily beat low expectations of .21 per share earning .26 despite revenues being down 9% from last year.  "Only" a 36% drop in quarterly profit is good enough for the bulls and GE is up 5% pre-market.  Don't get me wrong, I love GE and we've been playing them positive for quite some time but this is the BEST company in the market.  GE barely scraping by is no reason to stage a broad market rally!  Another best of breed is CitiGroup and…
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Phil's Favorites

Trump Tweeting As Much As Ever Amid Twitter Standoff

 

Trump Tweeting As Much As Ever Amid Twitter Standoff

By , Statista

President Trump has signed an executive order which aims to remove some of the legal protection given to social media companies, though it is expected to face significant legal hurdles. In a nutshell, it sets out to clarify the Communications Decency Act, handing regulators the power to file legal proceedings against social media companies for the way they police content on their platforms. Trump's decision to take action comes two days after Twitter attached a fact check to one of his tweets lambasting mail-in voting. He then threatened to close ...



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ValueWalk

Gold supply chain in recovery mode after pandemic shutdown

By Michelle Jones. Originally published at ValueWalk.

The gold supply chain was largely shut down as the COVID-19 pandemic spread around the world. However, things are starting to open back up, and production is beginning again. The World Gold Council studied the gold supply chain, how it was impacted by the pandemic, and how the disruption of the supply chain has affected investment demand for the yellow metal.

Q1 2020 hedge fund letters, conferences and more

Disruption to the gold supply chain

The World Gold Council said the gold supply chain is entirely global because the metal is mined on evert continent except Antarctica and refined in nume...



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Biotech/COVID-19

Antigen tests for COVID-19 are fast and easy - and could solve the coronavirus testing problem despite being somewhat inaccurate

 

Antigen tests for COVID-19 are fast and easy – and could solve the coronavirus testing problem despite being somewhat inaccurate

Antibodies are incredibly good at finding the coronavirus. Antigen tests put them to work. Sergii Iaremenko/Science Photo Library via Getty Images

Courtesy of Eugene Wu, University of Richmond

In late February, I fell ill with a fever and a cough. As a biochemist who teaches a class on viruses, I’d been tracking the outbreak of...



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Zero Hedge

Ted Cruz Accuses Twitter Of Violating Sanctions Against Iran, Demands DoJ Probe

Courtesy of ZeroHedge View original post here.

We've mentioned in nearly every single one of our posts about this week's dustup between the president and Twitter that the Ayato...



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Kimble Charting Solutions

Tech Indicator Suggesting A Historic Top Could Be Forming?

Courtesy of Chris Kimble

Tech stocks have been the clear leader of the stock market recovery rally, this year and since the lows back in 2007!

But within the ranks of leadership, and an important ratio may be sending a caution message to investors.

In today’s chart, we look at the ratio of large-cap tech stocks (the Nasdaq 100 Index) to the broader tech market (the Nasdaq Composite) on a “monthly” basis.

The large-cap concentrated Nasdaq 100 (only 100 stocks) has been the clear leader for several years versus the ...



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The Technical Traders

M2 Velocity Collapses - Could A Bottom In Capital Velocity Be Setting Up?

Courtesy of Technical Traders

M2 Velocity is the measurement of capital circulating within the economy.  The faster capital circulates within the economy, the more that capital is being deployed within the economy to create output and opportunities for economic growth.  When M2 Velocity contracts, capital is being deployed in investments or assets that prevent that capital from further circulation within the economy – thus preventing further output and opportunity growth features.

The decline in M2 Velocity over the past 10+ years has been dramatic and consistent with the dramatic new zero US Federal Reserve interest rates initiated since just after the 2008 credit crisis market colla...



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Lee's Free Thinking

US Southern States COVID19 Cases - Let's Give Credit Where Due

 

US Southern States COVID19 Cases – Let’s Give Credit Where Due

Courtesy of  

The number of new COVID 19 cases has been falling in the Northeast, but the South is not having the same experience. The number of new cases per day in each Southern state has been rangebound for the past month.

And that’s assuming that the numbers haven’t been manipulated. We know that in Georgia’s case at least, they have been. And there are suspicions about Florida as well, as the State now engages in a smear campaign against the fired employee who built its much praised COVID19 database and dashboar...



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Chart School

Is this your local response to COVID 19

Courtesy of Read the Ticker

This is off topic, but a bit of fun!


This is the standard reaction from the control freaks.








This is the song for post lock down!







What should be made mandatory? Vaccines, hell NO! This should be mandatory: Every one taking their tops off in the sun, they do in Africa!

Guess which family gets more Vitamin D and eats less sugary carbs, TV Show



...



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Digital Currencies

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

 

Blockchains can trace foods from farm to plate, but the industry is still behind the curve

App-etising? LDprod

Courtesy of Michael Rogerson, University of Bath and Glenn Parry, University of Surrey

Food supply chains were vulnerable long before the coronavirus pandemic. Recent scandals have ranged from modern slavery ...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

Free, Live Webinar on Stocks, Options and Trading Strategies

TODAY's LIVE webinar on stocks, options and trading strategy is open to all!

Feb. 26, 1pm EST

Click HERE to join the PSW weekly webinar at 1 pm EST.

Phil will discuss positions, COVID-19, market volatility -- the selloff -- and more! 

This week, we also have a special presentation from Mike Anton of TradeExchange.com. It's a new service that we're excited to be a part of! 

Mike will show off the TradeExchange's new platform which you can try for free.  

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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